Public Bill Committee

[James Gray in the Chair]

The Committee deliberated in private.

Examination of Witnesses

Simon Mullings, Giles Peaker and Liz Davies gave evidence.

James Gray: May I welcome our three witnesses to the first of several sessions this afternoon in which we are taking expert evidence on the Bill? We are now in public and our proceedings are being broadcast. Perhaps it would be easiest if the witnesses introduced themselves.

Liz Davies: My name is Liz Davies. I am a barrister specialising in housing and homelessness law at Garden Court chambers; I also act as a legal consultant to the Renters’ Reform Coalition.

Giles Peaker: I am Giles Peaker, a solicitor and partner at Anthony Gold solicitors and a housing law specialist.

Simon Mullings: I am Simon Mullings, co-chair of the Housing Law Practitioners Association. The experience I bring to this panel is 20-odd years of housing law practice, which includes representing tenants in possession proceedings on court duty in seven or eight different London courts across the years.

Matthew Pennycook: I thank each of you for coming to give evidence to us. I have two questions. The first relates to the amended grounds for possession, which we have discussed numerous times in previous evidence sessions. There are concerns about the amended or new grounds, particularly the de facto no-fault grounds that remain. Can you give us your view on some of those? Should they be removed entirely, made discretionary, or tightened in a way that might better protect residents from loopholes, abuse and exploitation by a minority of landlords?Q135

James Gray: Who wants to go first?

Liz Davies: May I start and deal in a little detail with ground 8A? I will then say a couple of things about 1 and 1A, but my colleagues can develop that. There is a great deal of concern about ground 8A, and the “three sets of rent arrears in three years and you’re out” ground. There is a concern that that is a mandatory ground and that it is punitive. There can be an awful lot of reasons why people in insecure employment or on zero-hours contracts, or just because of life events, can slip into arrears—and then make them up, of course—that get as far as two months. If that happens to you three times, you know that you will be subject to a mandatory possession order unless the landlord has kindly told you that you are not. It is punitive and unnecessary because we have ground 8. I would like to see ground 8 made discretionary, but we have it currently as a mandatory ground and we have the discretionary grounds 10 and 11 for rent arrears. I think there is a worry about unintended  consequences, because once a tenant is in that third set of rent arrears, you have to ask what incentive they have to remedy that position if they think they are inevitably going to lose their home. I am very concerned about ground 8A and would like to see it omitted altogether.
The courts have plenty of flexibility to deal with tenants who persistently do not pay their rent: such tenants can be subject to an outright order under any of grounds 8, 10 or 11. If ground 8A is to remain, much the best thing would be to make it discretionary, so that at least the court could look at whether this has happened inadvertently to somebody—whether they are now back in a reasonable financial position, can pay their current rent, have made up the arrears and should be able to stay in their home, paying rent to their landlord, which is of course a good thing for the landlord. The courts could enforce that. Equally, the courts are relatively wise: they can spot quite well a tenant who has no intention of paying rent in the future, and they can make an outright possession order if it is a discretionary ground. A discretionary ground is not a “get out of jail free” card for the tenant, by any means. I would like to see ground 8A either omitted altogether or made discretionary.
On grounds 1 and 1A, the deep concern is the short period of time that a tenant is protected—the six-month protected period. The Renters’ Reform Coalition and I would like to see that being much longer, because the six-month period merely reflects the current assured shorthold tenancy regime. The other big concern—I will not go into the detail, but you can ask me—is of course the extent to which a landlord may have no real intention of selling or moving back in: they simply wait three months and re-let. There has to be much greater provision about abuse.

Giles Peaker: I totally agree with Liz’s points. On 1A and 1B, the three-month period and the potential fine for breaking the three-month period both need to be looked at. If you consider what London rents are, the potential fine is actually less than three months’ rent, so there is an issue there. As it is currently drafted, the three-month period also appears to run from the point when the landlord has given notice and the tenant has left—it does not apply to a period after a court has made a possession order—so if the landlord brought possession proceedings and a possession order was made, they could then re-let the next day, with no penalty, even though the possession proceedings were on the basis that a family member was moving in or they were intending to sell.
I would also add a few words of caution—I am afraid that this is anecdotal, but it is certainly what I have gathered—from various practitioners in Scotland. There is a degree of gaming going on. There certainly have been a few tribunals in which a landlord who had supposedly been intending to sell most certainly did not and had never set the process in train—ditto in the case of a family member intending to move in. There is a question of what the evidential requirements would be for a landlord to establish that they were intending to sell, that they were in the process of trying to sell, or that they or the family member were intending to move in as their only or principle home. A simple statement that that is their intention cannot really be sufficient when the consequences for the tenant are quite severe. There is an option to use this as a sort of get-out for the abolition of section 21. The three-month period is too short.
On 8A, I simply echo what Liz said. If you are in a position in which, on literally three days—three separate, individual days—over three years, you find that you have slipped into two months’ rent arrears, even if you could make them up the very next day, you still face mandatory possession proceedings. That is extremely draconian. There would be no appeal to the courts’ understanding that your rent payments were otherwise perfect apart from those occasions, because it is a mandatory ground. It needs to be addressed.

James Gray: Do not feel that you have to say anything, Mr Mullings, unless you have something different to say.

Simon Mullings: On 1 and 1A, I would echo what my colleagues have said. I think you heard evidence earlier in the week in relation to the notice period for those grounds and how that could, in fact, benefit landlords and the court system in allowing more time for a tenant to find accommodation in those circumstances. I do not need to say any more about that.
I think 8A really does warrant more discussion. You have heard from both Giles and Liz how 8A is inapt, in that it is a far too draconian sanction for people who can find themselves triggering 8A through no fault of their own. In a cost of living crisis—

James Gray: I am sorry to interrupt, but we have only 45 minutes and then I will cut you off even if you are mid-sentence. Saying that you agree with one another does not add to the Committee’s general understanding, so say different things and do not feel that all three of you have to answer all the questions.
Please go on. I rudely interrupted; I apologise.

Simon Mullings: Not at all. The second thing about 8A is that it is not just inapt; it is inept because it will not do what it is designed to do, which is to stop the gaming of ground 8. First of all, in my experience—I hope this is useful to the Committee—I have only seen one example in 25 years of that occurring. On that example, the tenant then became subject to a suspended possession order under ground 11, which was a perfectly adequate way of dealing with it.
It is inept because it is perfectly possible to game ground 8A anyway. Let us assume that people do want to try and game it, but I really do not think people are doing that for a moment. If you get into two months or more’s arrears on a first occasion and then on a second occasion, you would think perhaps you should bring your arrears down to less than two months at that point. Well, not really; not if you want to game the system. You keep your arrears at two months or more so you do not trigger the third occasion. Then, when your landlord brings you to court, that is the moment at which you then pay off the arrears and try to game avoiding a possession order. So it is perfectly possible to game 8A anyway. It is not just inapt; it is not going to do what it is supposed to do.

Matthew Pennycook: Q  Briefly, to follow up on clause 6, which revolves around challenging the amount or increase of rent, we have concerns that even with the expanded right to challenge, the tribunal system will not provide sufficient protection. Do you have any thoughts on how, leaving aside other options, that process  might be tightened? For example, should the tribunal’s ability to award rents higher than what the landlord specifies be taken out of the Bill? Should there be other protections that allow renters to leave if they are served with that higher notice? Should they have another section 13 notice? I am keen to hear your views on how we might tighten clause 6.

Simon Mullings: A simple amendment to do exactly what you are saying, which is so that the tribunal does not set a higher rent than the landlord is asking for, would be extremely welcome. The reason for that is that if somebody comes to me asking whether they should challenge the rent that has been set by their landlord, I am bound to advise them that, unlikely as it is, the tribunal could set a higher rent. That has a real chilling effect on somebody’s willingness to then challenge a rent. It has been in section 14 of the Housing Act 1988 since it came into force in 1989, but this is a real opportunity to cure what seems to be a rather bizarre anomaly. I am not really sure why it was there in the first place, but it has this chilling effect. Also, section 13 challenges will become much more important when the Bill passes.

Jacob Young: Q  Thank you to our panel of witnesses. We have spoken a few times about ground 8A. What would you say to someone who said that it is unfair for landlords to suffer multiple breaches of rent arrears? And on a completely separate thing from ground 8A, we are introducing a new ombudsman to the private rented sector. How do you think that ombudsman can work? Would you say that it can help to reduce the pressure on the court system?

Liz Davies: I will start with the point about multiple breaches of rent arrears. I think that the answer to that is to trust the wisdom of the courts. The courts have the mandatory ground at the moment under ground 8—again, the concern is gaming and you have heard Simon’s answer on that—and they have discretionary grounds for possession under grounds 10 and 11. A well-advised landlord who wants to ensure that they can get a possession order from the type of tenant you have just described will ensure that they plead all the rent arrears grounds available to them, including ground 8A, if you put that through.
When you get to the court hearing, courts are perfectly capable of identifying somebody who has got into arrears in the past but has made them up or is in a position to pay current rent and to pay off the arrears within a reasonable period. Courts deal with people in financial hardship day in, day out; they are very good at scrutinising budgets and knowing whether or not an offer to pay is realistic. They are equally good at looking at a rent arrears history, no doubt prodded by the landlord, and saying, “Hang on a minute. You’ve just told us when your payslips were and you were not paying rent at that time. You really have been abusing the system.” And they will make an outright possession order.
Case law on suspended possession orders on the basis of rent arrears requires that a suspended possession order, as an alternative to an outright order, can be made only where the court is satisfied, first, that the current rent will be met in the future, and secondly, that if there  are arrears at the date of hearing, those arrears will be paid off over a reasonable period. There is some case law, depending on a landlord’s circumstances, about what a reasonable period is. Courts are very sympathetic to the point that private landlords in particular need that money paid back to them, so they are not going to approve an unrealistic repayment offer. I think that all the appropriate safeguards are there in the courts now. Of course, they are not currently used by private landlords because of section 21, which means that they do not need to. I think that those safeguards are there against the scenario that you have just suggested.
On the ombudsman, I will leave Simon and Giles to develop that point. All I would say is that an ombudsman is a very good thing. Access to justice through the courts is also a good thing. It would be wrong if some of the matters that courts deal with on behalf of tenants are then solely dealt with by the ombudsman. You have to have two opportunities.

Giles Peaker: Briefly on the ombudsman, in principle it is a very good thing, but it generally tends to depend on the ombudsman. It really is a question of somebody actually being able and willing to take a serious and proactive approach. I think that there has been quite a market change in the social housing ombudsman over the last five or six years, and performances have really turned around. An ombudsman is not necessarily an answer in and of itself, but it can be a very good thing and, in the right hands, it can be extremely useful.

Simon Mullings: We heard Mr Blakeway’s land grab earlier in the week—he fancies a crack at it. As Giles said, Mr Blakeway has done extremely well in the social housing sector, and, as Liz said, the ombudsman will do well in the jobs that it can do. It is not fair for landlords to face that situation, but it is also not fair for landlords to face a ground for possession that, whether they use it or not, will incentivise tenants to stop paying rent. I really believe that that is what 8A will do in certain circumstances.

Lloyd Russell-Moyle: Currently, the tribunal on rents is to make a determination of whether the rent could be reasonably expected to be made in the open market, and it therefore looks at new rents and not necessarily existing rents and other factors. There are some things that are disregarded and some things that the courts must have regard for. Is that enough, or should the courts have a stronger regard for other factors, in terms of a reasonable rent?Q

Liz Davies: Entering into a new tenancy at market rent is one thing, but there is a real worry about rent increases to market rent. Although it initially plausible sounds—why should rent not go up to the same level as elsewhere, if it was a new tenancy?—the problem is that you may then end up with an unaffordable rent for the tenant, who had entered into the tenancy on the slightly slower rent, and they then leave voluntarily, but as a result of economic pressure; and when I say voluntarily, I do not mean entirely voluntarily, but it is not due to a notice served or a court order. The Renters’ Reform Coalition is certainly suggesting that the tribunal’s power should be limited to inflation or local median wages to increase rents, along, of course, with the prohibition on increasing them more than the landlord has proposed. I think that must be right. I understand that landlords are conducting a business, but they have let the tenancy   initially at rent x; it is not that unfair for both landlord and tenant to have certainty that rent x will increase only by inflation or median wages, rather than out there in the open market.

Lloyd Russell-Moyle: Simon or Giles, do you have anything to add?

Giles Peaker: I do not have much to add, but I am not sure whether we have detailed information about what in-tenancy rent increases look like, as opposed to new tenancies, and what the comparator would be. Are in-tenancy raises usually reaching new tenancy market rents, or do they consistently remain at a lower level across the lifetime of a tenancy? I do not think we have that information.

Lloyd Russell-Moyle: Q  I suspect that the property portal will suddenly tell us that information, if it is collected. I also wanted to ask about deposits. At the moment, deposits are held in a deposit protection scheme. The deliberation as to whether or not it has been fairly withheld is done privately, and the only recourse is to appeal in the courts, which is quite a high burden. Is there a better way that some of those deposits could be handled? Could they be covered by the ombudsperson, or should there be a process whereby deposit disputes at least have to published? We do not even know the outcomes of deposit disputes at the moment.

Liz Davies: Three lawyers silent! I throw the question of how back to you, but I think there is something quite important about publishing the principles under which various disputes are determined, and therefore the exact cases. You may or may not provide the names and addresses, although, with the property portal, we would say you should do; it would be the sort of thing one would want to know about a landlord.

Lloyd Russell-Moyle: Q  So deposit complaints should be included in the property portal?

Liz Davies: I am thinking about it; I had not thought about it before, and it is a good point. However, on the process of determining a dispute between a landlord and tenant about whether or not the tenant has been in breach, whether the deposit can be returned and whether in whole or in part—there is something to be said for that to be published, whether that is by the current providers or within the property portal. The property portal would allow future tenants to know whether they might have difficulties getting their deposit back.

Lloyd Russell-Moyle: Simon?

Simon Mullings: I have nothing to add on that.

Karen Buck: Can I ask for your views on the Government’s intention to delay the abolition of section 21 pending court reform? You are all litigators. Is that necessary, given the present state of play? What do you think the delay might entail? What reforms would be required in order to ensure that the courts were meeting the standard that the Government are settingQ ?

Simon Mullings: No, it is not necessary.

Karen Buck: Short answers are fine.

Simon Mullings: We are lucky because we have had very recent statistics. The timescales for the various stages of possession and litigation are exactly as they were in 2019, when this Bill started its slow journey to where we are today. There is no doubt that there is a need to improve processes through the courts. What we have at the moment is an extremely good network of county courts, with a very evolved set of civil procedure rules that deal with possession claims very well. What we lack is resources for the county courts for both the physical estate and the personnel in the court to be there to provide the sort of first-class service that you would like to see in possession cases.
HLPA members have been campaigning on court reform and improvements to the court system since around 2015 or 2016, so we are all for it. I echo what Shelter’s director said earlier in the week: it is so important that we move forward with the Bill and the abolition of section 21, which is a key driver of homelessness and of misery, particularly for families with children in schools, who want the stability of knowing that the children can go to the local schools. Section 21 is also a driver of rent increases in various ways—I am telling you things you all know. I do not think there should be any further delay whatsoever.

Giles Peaker: I do not think it is necessary. I am reluctant to think that the process of legislation should be based on whether the courts are functioning as they should be. I agree with Simon: the actual process of possession proceedings is probably one of the quicker processes within the county courts at the moment and is fairly well honed. I would add that the current time from issue to a possession order under the accelerated possession proceedings—an “on the papers” process, without a hearing—is roughly the same as under the section 8 process with an initial hearing. There is no great time lag for the section 8 process as opposed to accelerated possession proceedings. Most possession claims will go no further than first hearing—if there is no defence, that is it. There would not be such a significant impact on the courts’ functioning to make this a concern that should cause further delay.

Jacob Young: Q  We heard evidence this morning that suggested that the courts are currently overwhelmed and that the abolition of section 21 would increase contested cases. That is not your assessment?

Giles Peaker: I do not see that it would necessarily increase contested cases. It would inevitably involve the process that leads to an initial hearing—those are 10-minute hearings on a list day. I really do not see why it would increase the number of contested hearings, because unless there is a defence, the possession order is highly likely to be made at the first hearing. On at least some of these new grounds, if the ground is made out, there is no defence. So I am unsure of the amount of additional burden.

Liz Davies: I think that is the point. Currently, under section 21, landlords can get possession on the papers. There is no court hearing: the papers go in; the tenant has the right to respond; the district judge considers on the papers whether or not there is a defence. If there is no defence, the possession order is made; if there is a defence, it is put over to a hearing. Once section 21 is abolished, the starting point is that there will be a five or 10-minute hearing, which is usually about eight weeks  after issue. That is about the same period of time as for the paperwork procedure I just described. At that hearing, the question for the court is, “Is the case genuinely disputed on grounds that appear to be substantial?” That is set out in the rules.
The great thing about that hearing is that there are housing duty solicitors at court. If a tenant does not have legal advice or advice from a citizens advice bureau beforehand, they turn up and talk to a duty solicitor—I am sitting next to one of them. Duty solicitors give realistic advice. If there is a defence—if the landlord has got it wrong—the duty solicitor will go in front of the court and say, “Actually, there is a defence,” and it gets adjourned for a trial, and that is right and proper. But if there is not a defence, the duty solicitor will say, “I’m sorry, there is absolutely nothing that can be said legally to the court,” and a possession order will be made.
One of the important things about advice, and indeed early advice, is that tenants get realistic advice, so they know whether they have any realistic chance of prolonging the proceedings, and so forth. In many ways, a hearing with a duty solicitor will be beneficial to landlords, and, as Giles says, it takes about the same length of time. There is lots to be said about county courts’ efficiencies and inefficiencies, but I do not think that is the problem.

Matthew Pennycook: Q  The Government dropped 111 pages of amendments on us on Tuesday evening, which is not particularly good practice—I will put that on the record—so you may not have had a chance to look through them, but if you have, do you have any thoughts about whether they address some of the deficiencies in the Bill that we and others have highlighted? My reading of the decent homes standard amendment is that it does most of what we want it to do; my reading of the “No DSS” amendment is that it does not. I wonder if you could flesh out a couple of the amendments that have been introduced and whether they do what is needed.

Simon Mullings: Two of us were involved in Rakusen v. Jepsen, and we were very happy about amendment 21—thank you very much for that; Christmas has come early. I understand that Shelter is looking very carefully at the “No DSS” amendment. I do not want to try to drive a tank on its lawn; I suspect that it will write in with any concerns it has about that. The principle, though, is extremely welcome. Forgive me, Mr Pennycook, but you mentioned another one.

Liz Davies: The decent homes standard amendment.

Simon Mullings: There was too much to read overnight, I am afraid, so I do not have anything particular to say on that.

Liz Davies: I was very pleased to see it, in principle. I am reserving my position on the wording. I am sorry; I am in the same position you are in, Mr Pennycook, from Tuesday night.

Matthew Pennycook: Q  Maybe I could invite you all to share any further thoughts you have down the line.

Liz Davies: We will write in.

James Gray: If you do, please write to the entire Committee.

Helen Morgan: I want to pick up on the point about delays in the court process. We heard this morning that the president of the Law Society is concerned about the lack of access to legal aid and the fact that, because so many people are unable to access it, they will be disadvantaged in the court process. My first question is, what are your thoughts on that?Q
My second question is about clause 18 and local authorities no longer having a duty to help people when they have been made homeless. Shelter has said that the Bill does not specify when help to prevent homelessness should be available to private renters. Do you have a view on that and how it could be addressed?

Liz Davies: First, housing legal aid is absolutely in crisis. The number of housing legal aid providers is diminishing each year. The Law Society has an amazing and heartbreaking interactive map where you can press on a county and discover that there are no housing legal aid providers or one of them in the area. Obviously, London is slightly better served. That is letting down everybody who cannot afford to pay for housing legal advice.
That needs fixing, and it needs an injection of resources—there is no doubt about that—but that is not a reason why there would be difficulties for landlords in obtaining possession under these new proceedings, not least because the Government have put this money into the duty solicitor scheme. Where there are no housing legal aid providers and a tenant turns up at court having been unable to find advice in advance, they will see the duty solicitor. While Richard Miller is absolutely right to be concerned about the sustainability of the housing legal aid sector—we all think it could collapse in a few years—this particular area of getting advice about possession is covered by the duty solicitor scheme. That is the first thing.
Homelessness is covered partly in clause 18 and partly in schedule 1, but this is one of the unintended consequences that the Committee should look at. The current position is that somebody is threatened with homelessness if they are likely to be homeless within 56 days. If they have a valid section 21 notice, which is two months or 56 days, they are threatened with homelessness. It is deemed. All that a local authority has to do is look at the notice and say, “Yes, that’s valid,” and that means that it owes the tenant what is called a prevention duty—a duty to help them to prevent the homelessness—and spends the next two months trying to help them to find somewhere else to live. That is a good thing, because if it works, it averts the crisis of homelessness. It means that someone can move from their previous tenancy into their new one.
As a result of the abolition of section 21, this Bill retains the definition of threatened with homelessness within 56 days, but takes away the deeming provision whereby if you have a notice of possession within 56 days, you are deemed to be threatened with homelessness. If that was reinserted, if a tenant received what would be a section 8 notice requiring them to leave within two months, you would be back in the straightforward position that they go along to a local authority, the local authority would say, “Yes, you are threatened with homelessness. We don’t need to make further inquiries or think about it any more. We accept that we owe you a prevention duty and we will help you to find somewhere else to live.”
That is absolutely the best thing, because it front-loads all the looking for somewhere else to live while a tenant still has a roof over their head, rather than waiting for the crisis moment when they have to go into interim accommodation or end up on the streets. I urge the Committee to think about an amendment that requires that section 8 notices count as deemed homelessness. I know there have been some drafts flying around, so the work has been done.

Matthew Pennycook: Q  I have three questions, if we can squeeze them in—I will get in as many as I can. Do tenants have enough power to enforce the measures in this Bill via rent repayment orders, and if not, where might we seek to reasonably apply them where they do not apply as the Bill is currently drafted?

Simon Mullings: Rent repayment orders create, as I have said before to officials in DLUHC, an army of motivated enforcers, because you have tenants who are motivated to enforce housing standards to do with houses in multiple occupancy, conditions and all sorts of things. There are clearly opportunities to expand the rent repayment order scheme, perhaps to sit alongside existing enforcement measures to do with offences. I am sorry that I do not have really specific references for you, but certainly expanding the rent repayment order scheme could in principle take some burden off local authorities in terms of their obligations, which would be an extremely important measure.

Giles Peaker: Was the question about enforcement of RROs or about the use of RROs in enforcing?

Matthew Pennycook: I suppose it was about their application—I think Mr Mullings has answered on whether they should be expanded in principle.

Giles Peaker: I would agree. I think that since the Housing and Planning Act 2016 they have been a success.

Simon Mullings: You would expect a legal aid lawyer to say that it would be great if legal aid were available to help tenants to bring RROs.

Matthew Pennycook: Q  Can I ask about the portal? At the moment it is a broad framework of powers, and we think that there are requirements that should be woven into it. I am thinking, for example, of all the preconditions and requirements surrounding section 21 that will fall away. Do you think there should be other information as a condition in that portal that goes much further, such as previous applications for grounds of possession, or even rent levels under previous tenancies? How much information should be transparent and available to tenants, in your view, on the portal?

Simon Mullings: I am tempted to say, “As much as possible.” For example, with ground 1 or 1A, if it were decided that post-possession order information was needed to ensure that they operate correctly, the portal is an ideal way of dealing with that. Very often, information relating to tenancies is a cause of disputes in possession proceedings—all the time. You have mentioned the conditions that attach to a section 21 notice at the moment; it will be extremely advantageous to landlords and to tenants, in an information and communication sense, to be able to essentially deal with those through a transparent portal.

Giles Peaker: To very quickly follow up on that, there is certainly the dropping of consequences for not providing gas safety certificates, energy performance certificates and so on. Everything except the deposit has effectively been dropped. Those are very important documents that are important for maintaining housing standards, so there need to be some consequences, other than a hypothetical prosecution by the Health and Safety Executive, for failing to provide that. Those kinds of things do need to be in there.

Karen Buck: Q  I want to ask your views on the amendment to ground 14 on antisocial behaviour. What safeguards do you think would need to be incorporated to ensure that, for example, that does not lead to vulnerable people—people with mental health problems, or those experiencing domestic violence and so forth—being at risk?

Liz Davies: The change from “likely” to “capable” is a worry. Ground 14 remains discretionary; I made the point about the wisdom of the courts, and one would hope that, where it is a case of domestic abuse, or a case of mental health, and so forth, the courts would have the wisdom to see that that person was not at fault. However, I do not see any need to reduce the threshold. If antisocial behaviour is such that a private landlord needs to get their tenant out because of the effect that that behaviour is having—usually on the neighbours but sometimes on the landlord themselves—then it is going to cross the threshold of “likely to cause”. I do not see the point in lowering it.

Jacob Young: Q  Thanks for that, Liz. We heard evidence this morning to suggest the contrary, as some build-to-let landlords were having to evict six or seven properties because of one that was causing antisocial behaviour. I guess that the whole thread through this Bill is about creating a system that is fair and balanced. Do you think that it is fair that a landlord would have to put up with a tenant creating antisocial behaviour and would potentially have to move other tenants on because they could not get that tenant out through the court process?

Liz Davies: No, clearly that is not fair, but the current ground 14 allows for a possession order when the tenant or somebody residing in or visiting the tenant’s property
“has been guilty of conduct causing or likely to cause a nuisance or annoyance”
to other people residing, living nearby or next door, visiting, and so on. So, that test is there. There is an antisocial behaviour ground for possession. It is discretionary, but the Bill will continue it as a discretionary ground; it simply lowers the threshold by a small amount from “likely to cause a nuisance” to “capable of causing a nuisance”. I really cannot see the circumstances in which a very difficult tenant who has been causing the sort of antisocial behaviour that you have just talked about will not meet the threshold of “likely to cause” but will meet the threshold of “capable of causing”. It is a very narrow distinction.
The point is that antisocial behaviour grounds are there—they really are—and courts use them. At the moment, they are used only by social landlords because of section 21, but we can all tell you that courts are very heavy on antisocial behaviour, and it is impossible for a tenant to remain in possession unless the court is satisfied  that that behaviour has stopped and will continue to stop. Courts do not allow tenants to remain in possession under the current test.

James Gray: I thank our three witnesses: Simon Mullings, co-chair of the Housing Law Practitioners Association, Giles Peaker of Anthony Gold solicitors, and Liz Taylor KC of Garden Court chambers. Thank you all very much for giving us the benefit of your wisdom.

Examination of Witness

Ben Leonard gave evidence.

James Gray: We will now have a series of quick evidence sessions of 15 minutes each with a series of learned witnesses, the first of whom is Ben Leonard, senior remote organiser and policy and research officer at ACORN, the union. Mr Leonard, will you introduce yourself?

Ben Leonard: My name is Ben Leonard. I work at ACORN, a community and tenants’ union. We represent thousands of private renters across the country.

Matthew Pennycook: Q  As a tenants’ union, you are in a unique position to give us some insight into the broad question of whether the Bill strikes the right balance between the interests of landlords and tenants. Can we open with that?

Ben Leonard: What my experience working with tenants and addressing their issues has taught me is that there is a massive imbalance of power between landlords and tenants, which leads to tenants being too afraid to speak up about repairs or harassment. The issue of no-fault evictions is central to that imbalance of power. If people know that a landlord can turf them out of their property and potentially make them homeless with just a couple of months’ notice, they will not speak up about things that need to be addressed, such as repairs. I am sure you are all familiar with the terrible condition of a lot of private housing in this country. In the case of harassment, including sexual harassment, we see tenants just grin and bear it because the stress of having to find a new property within two months is too much.
The Bill could be transformative for tenants. It could offer dignity and security to millions of renters who up until now have been denied that. But I am sorry to say that in its current form the Bill fails to address the fundamental problems that renters face. If a landlord can effectively pretend to need to sell or move into their property and turf out the tenants, we will still have no-fault evictions. If landlords can raise rents past what their tenants can afford, in practice we will still have no-fault evictions. If a landlord can send a tenant an eviction notice as little as four months into their tenancy, with just two months to find somewhere new, unfortunately the Bill will fail to give tenants the secure housing that they desperately need.

Jacob Young: Q  Thank you for your evidence. How do you think the Bill will improve the experience for tenants? We have discussed section 21. Do you think that abolishing section 21 will give tenants more confidence in going for new rental agreements?

Ben Leonard: As long as the loopholes that I have mentioned are ironed out and the Bill is strengthened in that way, it will massively shift that balance of power and give renters the confidence that they need to come forward. We are a tenants’ union, so we use our strength in numbers to put pressure on a landlord to make repairs and things like that, but it should not have to be that way. A tenant should be able to complain about repairs and get them dealt with in a reasonable timeframe. Often they are just too afraid to complain. I am not saying that every single landlord is a demon, but, as things are at the moment, the system allows bad landlords to treat people horrendously, with very little recourse for tenants. If the changes that I have outlined are made in the Bill, it could be really transformative for tenants.

Jacob Young: Q  That is what the Bill is trying to do. It is trying to prevent bad landlords, but bad tenants as well. One thing we are planning to introduce is a decent homes standard in the private rented sector. Is that something that you would welcome?

Ben Leonard: Absolutely. It needs to be robust, free of loopholes and properly enforced. There are two key ways to do that. The first is properly funding local authorities. It would be no use granting the powers to local authorities to enforce a decent homes standard—we all know the state of local authorities and their finances at the moment—if they do not have the resources or a duty to enforce. It just will not happen, with the best will in the world.
The other thing, which has been discussed already, is incentivising tenants to do it: creating an army of enforcers who are properly incentivised to report landlords who are not up to scratch. The property portal can play a big role here. More transparent information inherently gives renters more power to put pressure on and see when their landlord is lying to the authorities. If a landlord says, “We have met these standards” on the property portal, a tenant can look at it and go, “Well, that’s not true, and I can point to all the problems that exist,” and then there is an incentive for them to pursue it. I speak as someone who has pursued a rent repayment order in the past. I won 80% of my rent back, but it was a long, gruelling and difficult process, with no access to legal aid. The financial incentive was quite strong, but there were times when I felt like giving up. There are many ways to solve that problem, but making the process straightforward for tenants and properly incentivising and supporting them in it, alongside local authority enforcement, are important.

Lloyd Russell-Moyle: Q  I have a few points, if I may. You mentioned that the property portal needs to be available to tenants, but their access to it is not explicit in the Bill. Is it your view that it should be available to tenants or to the wider public?

Ben Leonard: Ideally, it should be publicly available information. You should not have to move into a property to discover that there are issues with it or that there are issues with the landlord; you should be able to check up a property on the portal before you move in. You should be able to see what it has been rented at in the past and compare that to the rent today. Has the landlord just done a massive rent increase, with no real improvement to the property? Do they have a history of improvement notices from the council? I would like to see that on there as well. In fact, any disciplinary action  against the landlord should be available there. Nobody, whether they are a family, an elderly person or a student, should have to move into somewhere to find that they have a rogue landlord and a house that is falling to pieces.

Lloyd Russell-Moyle: Q  The power of public pressure and the market might be more than the courts’ in that case. You have raised some of the fears about loopholes in grounds 1 and 1A. What protections could be put into 1 and 1A to make them work? Should there be a payment or other form of redress to the tenant if they are being evicted for no cause whatsoever?

Ben Leonard: To prevent abuse in the first place, there should be a high bar of evidence so that landlords have to really prove they intend to move into or sell the property in order to evict their tenants, and significant penalties for abusing that as well. We are talking about significant disruption to people’s lives that can have serious, knock-on consequences as well.
I do not want to go on too much of a tangent, but the consequences for children’s entire lives of having to move school frequently are profound; there is a lot of research that shows reduced economic, education and health outcomes for frequent school movers. Landlords need really seriously to prove that they intend to do it, and there should be significant penalties if they abuse the possession grounds, including fines and, for repeat offenders, complete bans. There should also be a no re-let period of 12 months: if a landlord decides that they need to move a family member in, then they do not need to any more, they cannot let the property for 12 months. There needs to be a serious deterrent to abusing those grounds. What was the second part of the question?

Lloyd Russell-Moyle: Q  The second part was about whether there should be some sort of recompense for tenants who are moving out, even if it is legitimate that they are moving out, through no fault of their own.

Ben Leonard: Definitely. That could take a lot of forms. It could be a simple payment, like a rent repayment, to help with that transition, or it could be that, from the moment the notice is issued, it is illegitimate to collect rent on that property and no further rent needs to be paid. That would go some way to, first, put off rogue landlords from abusing the power and, secondly, make the circumstances of the tenant’s life more liveable. Moving house is a massive hassle, especially if you have dependants, so if that is being foisted on you by an outside force, there is no reason why that outside force should not support you in some way.

Jacob Young: Q  To explore that final point you made about not charging rent having issued a notice to vacate, when someone has gone through that process, for a landlord that would mean two months of not getting rent from the property plus three months when the property could not be let again through one of the section 8 grounds. In the event that the landlord was intending to sell the property, but was unable to sell it and had to go back to market to re-let it, they will have gone five months without rent. Do you think that is fair? I appreciate that we would both agree that we want to stop bad landlords, but for a good landlord who wanted to sell their property but was unable to, is that fair, to be in the situation where they have five months’ rent withheld?

Ben Leonard: I think it is fair to place a reasonable barrier to the abuse of those grounds. These things are always a balancing act. Would it be fair for someone to have to continue paying rent while having to uproot their life and sort things out? They are not really getting what they are paying for in those two months, because those two months are spent preparing to leave, moving their children’s schools or saving for a deposit. They need to pay for all those sorts of things.
For the landlord, it comes down to the cost of doing business. Landlords make a hell of a lot of money on those properties, and I think it is reasonable that sometimes there are times when the amount of money they are getting in will dip because of such things. If it is a choice between landlords’ profits coming down for a series of months and tenants potentially being impoverished, I would choose the former.

Karen Buck: Q  I want to ask you about the decision not to proceed with the proposal in the “A fairer private rented sector” White Paper on limiting the amount of rent that the landlord can ask for in advance. Is that an experience you found with the people you work with? You talked about frequent moves being very inconvenient, as well as extremely expensive.

Ben Leonard: Yes, absolutely. The limit on deposits was a huge step forward, but they are going by the back door, so not much has changed, because people ask for rent in advance. I can speak from my own experience: I had to pay six months’ rent in advance before moving to my current flat. A lot of the people I know and work with do, and often they are borrowing money to do it, because not a lot of people have that kind of money lying around. In a way, it is often discrimination—it is a way of saying, “Well, you might be able to afford the rent, but we don’t like the look of you. Let’s see if you can stump up this much cash up front.” It is totally unjust, basically. If you are earning enough income to pay the rent, the property should be available to you. That is the bottom line; extra barriers should not be put in the way, such as rent up front.
Bidding wars are a big thing as well. Something should be done about landlords pitting tenants against each other to drive up rents. If a landlord wants more rent for a property than it is on the market for, they should have listed it as that in the first place, because again tenants end up chasing properties for months at a time, because everything they think they can afford suddenly goes up £300 or £400 a month by the time they can actually let something. It is an absolute nightmare. Imagine you have been evicted, then you are put in a situation of rent in advance and all that. It just doesn’t work. It is a broken system.

James Gray: Very quickly, Minister.

Jacob Young: Q  I appreciate the evidence that you have given today. Do you have any concerns that some of the measures that you are talking about could potentially reduce the supply of homes? Therefore, the very people you want to protect, whom we all want to protect, tenants, would not be able to rent their homes.

Ben Leonard: Are you talking about landlords exiting the market?

Jacob Young: Yes, if the Bill is too punitive.

Ben Leonard: The first point to make is that these reforms are reasonable, and if a landlord is not willing to deal with reasonable reforms, they have no business renting to someone in the first place—it shows that you are not of good enough character to supply someone’s home.
Secondly, the evidence does not show an exodus from the market. The reforms were announced four years ago, and there are more landlords now than there were then. From the evidence that I have seen, it seems that mainly smaller landlords are selling up to bigger landlords, which from the point of view of the tenant can be a step forward. Many tenants have a better experience dealing with corporate landlords than with one-man bands, who do not know the regulations, cut corners and will take advantage of vulnerable people. Generally, you do not get that with corporates. From the point of view of tenants, it is better to deal with larger, more professional organisations.
The other thing is that that provides an opportunity for first-time buyers to get in the property market. We would like to see a situation in which most people in private renting are either in council or social housing, or are homeowners. If landlords were selling up, first, first-time buyers could get on the property market—

James Gray: Order. I am sorry. I feel I have to interrupt you, it being three o’clock. As Big Ben strikes, you have to stop speaking. I apologise for that. Mr Leonard, thank you very much for your evidence, which has been useful to the Committee and will be useful in the discussions that lie ahead.

Examination of Witness

Chloe Field gave evidence.

James Gray: We will now hear from Chloe Field.

Chloe Field: Thank you for having me. I am Chloe Field. I am the vice-president for higher education at the National Union of Students, which represents students and students’ unions across the country on various issues facing students right now.

Matthew Pennycook: Q  Thank you, Ms Field, for coming to give evidence to us. I have two related questions, which are quite broad, to get us into the issue. Do you think the Bill as it stands takes sufficient account of the particular needs of every aspect of the student market, which is not uniform? There are different people starting courses at different dates and people renting different types of houses. Do you think it takes account of that? Then, specifically on the Government amendment that was tabled on Tuesday for a new mandatory ground for possession for student houses in multiple occupation, do you have any concerns about that? How workable do you think that is?

Chloe Field: I do not think it takes sufficient account of the student rental market. People forget how unique and diverse students are and the student rental market is. As you just mentioned, students do not always do their courses in the typical September to June time. We have postgraduate researchers who study and work throughout the year. We also have mature students and  students who have families and who will live in properties with non-students. There are things there that need to be taken into account regarding students in the Bill.
We also have the fact that the student rental market is very precarious. Renting in that market is rushed; you are expected to sign a contract about nine months before you move. That means that students end up having to pay really high prices because there is such a rush and people just accept the first house they find. It also means you cannot do sufficient research into the house you are about to sign the contract for. For example, is there mould? Is the quality of the house any good? Those are the unique factors of the student rental market.
In terms of the student exemption, our position has always been that it is incredibly dangerous. It sets a precedent that students will not be afforded the same rights as other renters and sets a further precedent for any future reforms and future exemptions for students. Like I said before, students are not a homogeneous group. They are not just 18 to 21-year-olds doing an undergraduate degree. They come in all types and different forms. It is one thing to make an exemption for purpose-built student accommodations, which is a type of accommodation, but it is another thing to create an exemption for a demographic of people who are studying. We are worried about that.
Also, the reasoning is that landlords are threatening to leave the market. As the previous witness said, landlords should not be renting in a market where they cannot accept that there are slight reforms and accountability for landlords. We consistently see exploitative landlords in the student market. I do not think we should be left threatened by those rogue landlords who cannot accept any form of regulation. Those are the main things on the student exception, but we accept that if there is that exception, it has to be carefully curated to fit the student rental market.

Lloyd Russell-Moyle: Q  The Government have tabled an amendment that would create a ground 4A, which is what you were just talking about there. Have you had time to look at that and do you think it is tightly or too broadly drafted? Are there particular things, such as requiring accommodations to be rented by the university or something, that might give that level of protection, rather than it just being that there happen to be students in that house?

Chloe Field: If I remember it correctly, it is good that the amendment specifically acknowledges term times and stuff like that, but it specifies a certain time in the year and, as I said before, not all students fit into term time. It does not sufficiently recognise that different types of students rent in different ways; they are not a homogeneous group of people. Some students live with non-students and families, and it does not fully recognise that.
An idea we have floated is if there is an exemption, it should potentially be done like a council tax exemption: HMOs with a certain percentage of students are exempt from council tax. We think that kind of specification will be really important. Without more specification about the exemption, for a lot of students, especially those living in family homes, there will be the threat of back-door evictions if they have started their studies.
Your idea about universities renting out accommodation is really good. It would provide a bit more accountability if the institution that provides the education and has a form of duty of care is responsible for the accommodation. I think that is really important, but if that is the case, we would have to take it further. Right now, prices for university-owned accommodation are going up. Universities are trying to bring in more and more students to make more money because their incomes are so precarious right now, and that is not sustainable. We would have to look at the higher education model as a whole if we were thinking of doing anything like that.

Lloyd Russell-Moyle: Q  A lot of the reforms in this Bill will advantage people who are in the property for a long period of time. They will be able to enforce their in-tenancy rent controls better, and will hopefully be able to take the landlord to task if it is not a decent home. When someone is there for only a year or two years, or whatever the time period is, that is much harder. Do you think there are things that should be put in the Bill to ensure speedy enforcement in some of these areas and the ability for students to seek redress?

Chloe Field: Yes, I do. I do not know exactly how that kind of speedy enforcement will be put in place, but I definitely think it is necessary. One of the issues we often see is that students feel like they do not know how to hold their landlords to account or complain about them. Especially if they are a first-time renter, they will not have the knowledge or experience to hold their landlord to account or make sure they are complying with the current laws. There is a lack of knowledge there, and the information and the routes are not very accessible. Alongside their studies, students work part-time jobs more and more so they do not have the time to take their landlords to court. There are a lot of those issues.
The short-term nature of a lot of student rentals means that landlords bank on the fact that students often do not complain and tend to suck it up because they know they will leave in May. I had the same issue: I had a lot of mould, and the landlord was not doing anything. I thought, “Well, I’ll go home to my parents’ for a bit to prevent myself from getting ill, and I’m leaving in May, so it’s fine,” but that meant that the landlord could just paint over the mould and sell it to the next person. Accessibility and speed is vital in those cases so that students have an easy route that they can go down quickly to complain about their landlords.

Lloyd Russell-Moyle: I have another question, but I do not want to hog all the questioning.

James Gray: No, you have another two minutes.

Lloyd Russell-Moyle: Q  At the moment, the student market seems to be moving towards a place where people have to choose their accommodation up to nine months before they move into it. Some people have welcomed that, but it does not seem to work very well for students. Does moving to a situation where the properties will not become available on the open market, apart from two months before the start, actually help or hinder students in selecting their accommodation without having to have done it months in advance?

Chloe Field: There are multiple things going on. I think it could be helpful if it were nearer the end of the academic year, so that people actually know if they are  going to do another year of study, and they have more established friendships and stuff like that. I think that would be useful.
Also, because the current market has been neglected and unregulated for so long, I think that this panic instilled by landlords would still happen even if it were two months before. Landlords purposely drop their housing on the same day so that people feel that they have to rush and get it. With student intake numbers getting so high right now in cities and areas that cannot actually provide accommodation, there is this rush for similar properties that drives up prices. I think that could be helpful, but there also needs to be a lot more done to control the market so that landlords are not allowed to run truant, dump their properties and increase their prices. Universities also have a responsibility to look at what housing is available for students before they increase their student intake.

Lloyd Russell-Moyle: Q  So you think there should be some restrictions on universities?

Chloe Field: Yes.

Lloyd Russell-Moyle: Q  I would like to go back to ground 4A being proposed by the Government. It makes it a very binary choice between there being students in the accommodation or no students in the accommodation. You have mentioned that many students live in mixed accommodation. Is there sometimes an advantage for students in being able to extend contracts when they become no longer a student to actually provide stability in local communities that are often saturated anyway?

Chloe Field: Yes, 100%, and that is something else that we believe: just being able to have that freedom to not feel like you are chucked out of a house, then you are meant to find a job, and then a house—or you move back to your family house, which can be quite isolating for a lot of students. It is even just that freedom to stay a couple of months. It also means that students who like the community and the area that they are living in are allowed to invest more into that community because they know that are they are not just going to leave once they graduate. They can remain there, find a job and work there, and also invest in that community. We consistently see the town/gown issue, where residents do not like students being in the area and students do not like residents and fall out with them—not always, but there is a lot of contention there. I think this would really help to meld the community together.
On a separate point about building community, if students are exempt from aspects of the Bill, then a lot of rogue landlords will go into the student market because they will take advantage of the lesser regulation, which means that more houses in multiple occupation are going to be built in residential areas, again furthering those divides between residents and students and moving residents out of their local areas. It can create that distinct divide instead of creating a harmonious community where both students and residents live together.

Lloyd Russell-Moyle: Q  Finally—we have a few more minutes—on Tuesday we heard that the two-month notice, meaning that someone can give notice and then move out within two months basically on the first day, could be bad for students because sometimes they do  not get on with their flatmates. But when you force them together for two months, they then suck it up and get on with it. Is that a fair description of what happens, or would you describe it in a different way—that ability to move out if something has gone wrong very quickly?

Chloe Field: First, it allows people who do not get along with each other to leave; again, with the rushed market, a lot of people are forced to live with people they might have only known for a couple of months. Also, if they have signed their contracts, moved in and then three months later there is black mould everywhere, it allows people to leave, which puts the balance of power back into the tenants’ hands. That means that tenants can leave and also puts pressure on landlords to actually have their home up to scratch, because they know that the tenant could leave at any point. I think that would be a really important thing for students. Also, if you want to drop out of uni because your mental health is bad and you are not enjoying it, you have the freedom to leave. You are not stuck in a contract and paying tuition fees and rent in a place where you do not really want to be.

James Gray: Thank you very much for your evidence. That was Chloe Field, the vice-president for higher education for the National Union of Students. Very useful indeed, thank you.

Examination of Witnesses

Samantha Stewart, Linda Cobb and Roz Spencer gave evidence.

James Gray: May I ask you to introduce yourselves for the record?

Samantha Stewart: Good afternoon, Committee. Thank you for inviting us to speak with you this afternoon. My name is Sam Stewart, and I am the interim chief executive officer of the Nationwide Foundation. Some of you know us, but for those who do not, we are an independent national charity that since 2013 has been supporting, testing and evidencing solutions to the UK’s housing crisis, particularly from the perspective of those most in need. Part of our work funds projects that aim to transform the private rented sector, including the Renters’ Reform Coalition, which you have heard a lot from this week, and the longitudinal RentBetter study, which is looking at the impact of Scotland’s tenancy reform. From our perspective, the evidence from Scotland is particularly helpful in understanding how the Renters (Reform) Bill can be strengthened to better protect those who are most vulnerable, which is our focus today.

James Gray: Before we go on, are you linked to the Nationwide Building Society?

Samantha Stewart: We are very independent, but totally funded by it.

James Gray: The reason I ask that is: are you personally based in Swindon or Wiltshire?

Samantha Stewart: Swindon.

James Gray: Swindon—fine. In that case, you are not a constituent of mine. Had you been, I would have been extra nice to you.

Linda Cobb: Hello, I am Linda Cobb, the manager of DASH Services. DASH stands for Decent and Safe Homes. We are a local authority-led service aimed at improving standards in the private rented sector, and we work with landlords and local authorities across England.

Roz Spencer: Hello, I am Roz Spencer. I run the third sector organisation called Safer Renting, which has been operating in the last eight years, providing advocacy support to private renters in what we call the shadow housing market. We see a lot of the worst-offending behaviour, and are somewhat jaded as a result.

James Gray: Surely not!
We have 45 minutes for this panel.

Matthew Pennycook: Q  I have two questions, the first of which relates to standards. The Government have tabled an amendment introducing a version of the decent homes standard. I wondered what your thoughts were on that and, importantly, on the ability of local authorities to enforce it. I am thinking of part 3 of the Bill, which will put a general duty on local authorities in a number of areas. If we introduce the decent homes standard in the way that the Government have proposed, will it materially improve residences, and will local authorities be able to enforce it effectively?

Linda Cobb: In its current format, a property is classed as being decent if it is free from category 1 hazards as defined in HHSRS. The decent homes standard is linked to HHSRS, and many landlords and tenants do not really understand HHSRS. It is complex.

James Gray: Sorry, but what is HHSRS?

Linda Cobb: The housing health and safety rating system. It is a tool that local authorities use, and a fundamental part of the decent homes standard.
Based on that, HHSRS was reviewed recently. It has gone through a two-year robust review, looking at how it is enforced, what will be included in it and how it will be altered. One of the workstreams in the review looked at the guidance for landlords and tenants. That review is now complete but has not come into force yet. As the decent homes standard relies on HHSRS and we need users to engage with it, it is really important that the reviewed HHSRS comes into force as soon as possible, so that enforcement teams and training providers such as DASH can embed it and get used to it, and so that landlords can get used to the tool as well. The decent homes standard is another layer of enforcement, which really goes to the point that local authority enforcement teams are lacking appropriately skilled and resourced multidisciplinary teams. There is lots of information there.
Finally, when we are looking at decent homes standards, we need to learn from the electrical safety regulations and the smoke and carbon monoxide regulations. When they came into force, they created huge spikes in demand: you could not get an electrical insulation condition report because there were not enough electricians around. You could not get hold of carbon monoxide detectors, which needed to be in every rental property, because there was not the supply of them. We need to learn lessons when looking at decent homes standards as well.

Roz Spencer: Could I just add, from the point of view of how things work out in the shadow private rented sector, that the proposal in the Bill that enforcement  teams have the right to go and inspect properties proactively, without having to rely on complaints, is important and welcome? Particularly in the shadow sector, tenants are quite unlikely to report and complain because of their fear of consequences, so even if it does not happen, the fact that it can be concluded that an enforcement team is acting on intelligence proactively and the tenant has not necessarily complained is a helpful protection for renters.

Samantha Stewart: On the enforcement of standards, it is really important to add that one of the main findings from the Scotland research was that even if the law changes, it has limited effect without proper enforcement. Despite the changes, that research told us that tenants living in poor conditions still struggle to access local authority enforcement, leaving them without any other form of redress.

Matthew Pennycook: Q  Do I take it from your answers that it is partly a resourcing point, but it is not just resourcing; it is the skills and capacity?

Linda Cobb: It is, yes. Enforcement teams across the country are producing some fantastic, life-changing results for tenants; however, they are doing so in a very firefighting, reactive way. This Bill and the decent homes standard do not change that—they do not magically change the fact that those teams do not have the staff or the training ability. Going back to what Sam said, DLUHC commissioned a report in 2022 that explored local authority enforcement and concluded that capacity and skills shortages in enforcement teams can undermine any potential gains from legislation and new powers.

Matthew Pennycook: Q  On a completely different issue, we have spent a lot of time discussing chapter 1 of part 1—reforms to the tenancy structure, grounds for possession and so on—and relatively less on part 2, the ombudsman and the portal. Could you give us your general views on what the Bill does, on whether it is prescriptive enough and on what either or both of those things should look like in practice?

Samantha Stewart: We strongly welcome the provisions in the Bill, particularly on the property portal. We believe that it will create an essential tool for the PRS to drive up standards and improve landlord compliance, supporting enforcement teams and also supporting landlords to understand their rights and responsibilities. This is something that the foundation has been calling for, for some time. As some of you will know, we funded a report called “The Evolving Private Rented Sector”, by Julie Rugg and David Rhodes, which was published in 2018 and called for a national landlord register.
As an important addition, that research also recommended ways in which the portal can work. One of those recommendations, which we support very strongly and which you heard about earlier today from Jacky Peacock, was for an independent property assessment. That assessment could confirm compliance with safety and other relevant checks on the property, and would also be required to be submitted to the property portal before the property can be let out. One of our beliefs is that the property assessment, alongside the portal, will help to shift the burden of compliance somewhat from overstretched local authorities to landlords and the property portal itself.

Roz Spencer: This may be a statement of the obvious, but Safer Renting recently pulled together the best estimate it could from published data about the incidence of offences under the Protection from Eviction Act 1977. Why did we do that? Because nobody else does it and there is no reliable centrally held Government data. This goes into a massively controversial space. People are always arguing on both sides of the fence: “Is this a big problem? Is this not a big problem?”
The absence of data fundamentally undermines the process of good policymaking and being able to identify, for example, the unintended consequences or omissions in legislation. It also undermines enforcement, which I think my colleagues will speak to more eloquently. Having big data is so important. Otherwise, how can you legislate, and how can you know the impact of your measures? When the public finances are so stretched—as we have heard from Linda, there is a problem with skill shortages and capacity in enforcement teams—you really need to have slick systems. That is what a well-designed portal needs to offer: a slick system that will support something that is really stretched for resources and needs systemic support desperately.

Samantha Stewart: Do you want me to take the question about the ombudsman?

James Gray: I think we have moved on. Let’s crack on with the Minister.

Jacob Young: Q  Thank you, everyone, for your evidence so far.
Roz, do you think the portal addresses the problems that you see in the shadow rented sector, in so far as it brings it into the light by making people aware of where those landlords are, highlighting their bad practices?
Samantha, I am very interested in the assessments that the foundation has done in Scotland. What big lessons have been learned from them which could inform how we shape this Bill?

Roz Spencer: I think the devil is in the detail. You need a well-designed portal, and there are many seasoned professionals in the licensing and enforcement field who can tell you exactly what needs to be in that portal. Provided that it is well designed, I think it would be enormously helpful—both to hard-stretched enforcement teams and to people like me in the third sector, who are trying to advocate for tenants in the shadow sector who do not understand their rights—in empowering people to access that information to support themselves.

Samantha Stewart: Are you wanting to understand the more general lessons that we have learned from Scotland around the PRS reform?

Jacob Young: Q  Yes, I think so, but also where this Bill is lacking and how we could strengthen it, based on your evidence from Scotland.

Samantha Stewart: There is lots of evidence. The research commenced in 2019; it is a five-year piece of research. From the perspective of this Bill, it gives us key evidence on how English reform might and will impact vulnerable tenants. That is important, because we know that vulnerable tenants are the most at risk of being harmed by a poorly functioning PRS: they do not have the same consumer power, confidence or voice as  their better-off peers. We know that vulnerable tenants have not benefited in the same way as their better-off peers from the reforms in Scotland.
There are two main things we know are happening. The first is about enforcement, as I have already said. Even if the law changes, it has limited effect without proper enforcement. Tenants living in poor housing still struggle to access local authority enforcement, leaving them with no resource at all to address their problems. The second relates to the new mandatory grounds. When the Scotland equivalent of section 21 evictions was removed, some landlords found that they could continue to carry out revenge evictions by abusing the new grounds on sales and on landlords moving in.
I will give you an example. Take Luke, a renter who lived in a property with rats and maggots falling out of his ceiling. The landlord refused to address these issues for months after Luke asked, but was forced to do so by the Scottish tribunal—great. However, shortly afterwards Luke was evicted from his home by his landlords, using the new possession grounds, and soon after he moved out, the property was re-let—not so great. That is just one example of how an unscrupulous landlord can abuse the new grounds if there are not sufficient safeguards.
We know that it is vulnerable tenants who will suffer most, for reasons that I have already mentioned. Based on that evidence, in order for the Bill to benefit vulnerable tenants, it needs amending to provide additional protections for them. First, landlords using grounds 1 and 1A—moving in and selling—should be required to provide adequate and appropriate evidence that they are selling or moving back in. Secondly, landlords who evict tenants using the new grounds should be prohibited from re-letting for a year, not three months. Three months is just not good enough—it is not a meaningful deterrent to landlords—but we believe a year would be. Thirdly, the Bill should be amended to provide a clear legal mechanism for tenants to seek redress, such as through a rent repayment order. Those are the three areas that we feel would really strengthen those mandatory positions.
I will finish by saying again that we really, truly believe that good landlords doing the right thing, who are the majority, would not be affected by changes along these lines, because they truly believe that they are providing homes.

Jacob Young: Q  Is there anything in the Scotland reforms that you are pleased that we are not replicating?

Samantha Stewart: That is a really good question.

Jacob Young: Also, forgive me—I cannot remember which panellist mentioned Jacky Peacock earlier on, but she talked about this idea of an MOT in order to access the portal. Each of the panellists has mentioned that local authorities have struggled for resource. How would an MOT help? Who would verify such an MOT? I suppose, if we were to go down that route, it would mean local authorities facing even more burdens.

Samantha Stewart: In answer to your first question, there will probably be some. I will definitely make sure that we cover that in our written evidence, because I am sure there will be something we can contribute that we are pleased not to see. Forgive me—I do not know that answer right at this moment in time.
On the MOT, we all know that it is not an easy thing to do, but there is certainly a lot of detail in the Rugg and Rhodes report about how we could go about that. Again, I would be really happy to put that in our written evidence.

Linda Cobb: I manage a large landlord accreditation scheme across lots of different local authority borders, and obviously landlords then register on to a portal, so I am aware of the complexities of managing such an unwieldy beast, so to speak. As part of our landlord accreditation scheme, we have a property check—similar to what Jacky was saying with the property MOT. We do a sample compliance check. DASH and Unipol looked at about 2,000 properties that we had inspected; we assessed those inspections, and we had actually helped our landlords to remove or reduce almost 1,500 hazards that simply would not have been removed or reduced by simply registering on a portal and just self-declaring. Those were good landlords; they were landlords who were willing to make the change, and they made it quickly. But there is an argument that with just self-declaring, we have to be careful about the digital policing of a portal and giving false assurances. We can learn from landlord accreditation schemes and from schemes that are already going on. We really need to do that with the portal as well.

Samantha Stewart: It’s true. It is about taking the best in class as well, isn’t it?

Linda Cobb: Yes. We also have to be careful about avoiding duplication. From my landlord accreditation scheme, I know that landlords do get a little bit confused—they have licensing, accreditation, deposit registration and so on. If we are going to add an ombudsman, we will have to be very careful about avoiding duplication.

Helen Morgan: Q  The market is fragmented. Lots of rented property is owned by people who only have between one and four properties. Those people are essentially unprofessional, even if they are willing. I am worried about how they might slip through the gaps because, if they are not using a letting agent or a management service, they may be unaware of changes to the law or of how to register. How do you think we should address that so that landlords know what they need to do? How can we ensure that tenants know that they have access to this information and the right to challenge? I doubt some of those people are following what is going on in this Committee.

Linda Cobb: I will take the landlord bit. I think that to call smaller landlords unprofessional is not quite right. The majority of landlords in our landlord accreditation scheme have between one and four properties; most have just one. We see very professional behaviour.

Helen Morgan: To clarify, I do not mean that they are deliberately unprofessional. I just mean that they may not be on top of all the legislative changes.

Linda Cobb: Yes. I think we need to change the way we communicate with landlords. We need to get information out there, because what we found through trying to drive up numbers in our accreditation scheme was that a landlord could be anywhere. Marketing was very difficult. Where do you go to advertise this information? It has to be very mainstream. Look at gas safety certificates:   the campaign when they came in was very effective because it was a mass campaign. Safe Suffolk Renters is doing something very similar and we can learn from its work. Going back to what Sam was saying, we should learn from what has been good in the market at getting messages out there.

Roz Spencer: From a renter’s perspective, there is the obvious problem of renters’ knowledge about their rights. I think there are three reasons why renters’ understanding of their rights is poor: landlord and tenant law is so complicated; tenant rights are so slim; and the expectation of enforcement is at a low ebb. Renters have challenging lives and other things to think about. Their bandwidth to pay attention to something complicated, thin and unlikely to deliver for them is quite limited. If you get things right around renters reform, raising renters’ awareness of their rights will be much easier.

Linda Cobb: I am a big fan of going back into schools and doing work at that very early level. The majority will go into rented accommodation at some point, and we need to get into schools to show young people what a good tenancy is like and what their rights are from a very young age.

Samantha Stewart: That is a really good point. Let’s face it: renters are going to be renting for a long time, so getting them to understand things early, right from the start, is a fabulous opportunity.

Linda Cobb: Yes. They should understand what their responsibilities and rights are.

Nickie Aiken: Sam, I was interested in what you were saying about maggots falling out of cracked ceilings. I was a councillor for a long time and a cabinet member responsible for public protection. That included environmental health. I was regularly shocked by how often tenants lived in such dreadful conditions until someone said, “You should report that to environmental health,” and then there would be a notice to improve. Surely there are protections now, but tenants do not know about the Environmental Protection Act 1990 or the Housing Act. This Bill will strengthen things like that, but what can we do to improve people’s knowledge of the fact that they can still go to environmental health to get their housing sorted?Q

Samantha Stewart: I think we just have covered some of the ways that we can do that. We just have to repeat the message consistently: there are fabulous organisations out there that advocate for and help tenants, and there are fabulous local authorities that can do the same. I can speak more from a vulnerable tenant perspective, because that is our focus. Even if they know where to go, they do not go, because they do not feel they have the power and they fear eviction if they tell anyone.

Nickie Aiken: Q  Do you think that that will change under this?

Samantha Stewart: Not without a significant increase in safeguards around the new grounds for possession.

Linda Cobb: In the 2021 Chartered Institute of Environmental Health report, 56% of local authorities reported vacancies in their teams, so that phone call is going to go unanswered, and that email is going to go right to the bottom of the pile, even if they did complain. Then people will say, “My auntie complained to the  council and nobody got back to her”—that sort of mentality—and they will not feel that they will be listened to. The report also said that 87% were relying on agency staff to fill that gap, and they are obviously expensive, so you can have only one of them as opposed to two full-time equivalents.
We are looking to stem that bleed with local authorities, and we are looking at ways to increase the training in the industry. We are losing very good local authority environmental health officers, because they are either retiring or leaving the sector because they are tired of it. We want more of the one-year private rented sector enforcement training courses, so we are working with our local university and training providers to get those up and running. We also want an apprenticeship-levied housing practitioner training course, which would help with these multidisciplinary teams. The team could then deal with all aspects—as well as physically going out, it could offer information about what the tenant can do themselves.

Samantha Stewart: I will just finish by saying that we also fund seven organisations across the UK that are working with tenants, particularly in the more vulnerable part of the sector, to help them strengthen and increase their voice. One of the reasons we are doing that—helping them to enact and effect these changes themselves, speak up for themselves and know their rights—across the UK with very different types of organisation is so that we can learn what works best and then use that evidence to inform policy.

Karen Buck: Q  Can we go back to the issue of illegal evictions? Roz, you said that there is a lack of data in that area, which is absolutely right. Your organisation, probably more than almost any other, has a wealth of anecdotal information about what is happening. What can you tell us about the trends and characteristics? Is there any sense that some people pursue that route because of the problems in the court system? We have had quite a lot of discussion—other witnesses may have a view on this—about the proposed delay because of the problems in the court system, and some witnesses were very clear that there are no justifications for delay. What does your experience tell us about that, and what have you picked up about the reasons for such evictions?

Roz Spencer: Thank you for asking. You heard it here first: the safer renting count, which was first established in 19—sorry, 2021; I am showing my age—established a methodology that looked at five different sources of data that could be collected on an established, reliable basis, and did not involve any significant overlap between the data points, and we have just updated those figures from 2021 to 2022. The trend between those two years is an 18% increase in reported offending under the Protection from Eviction Act 1977—so, those are illegal evictions and cases of extreme harassment likely to give rise to the loss of a home. That 18% uptick is of significant concern. I have no evidence to suggest that the performance in courts has had any bearing on that, and I would be surprised if it had.
There is another figure that is interesting—I think it is buried in the Government’s H-CLIC data. All local authorities report on trends in Protection from Eviction Act offences leading to homelessness. That is a very big, stable and reliable time series for the data. Interestingly,  during the pandemic, when there was a ban on section 21 and a subsequent inability to use bailiffs to enforce lawful evictions, there was a substantial drop in lawful evictions between 2020 and 2021. There was no such drop in the number of unlawful evictions. In fact, those numbers held up, sadly, at more or less the same level. As a proportion of evictions leading to homelessness, the figure came close to doubling.
The interesting suggestion buried in that statistic is that it is so important, when you are quite rightly considering replacing section 21 with new grounds for possession, that you avoid the unintended consequences of those changes in access to lawful eviction increasing the number of landlords who feel that they can get away with just doing it anyway.
I have another statistic to offer you. If you look at our count of what we think is a very conservative estimate of the number of unlawful evictions and the Ministry of Justice statistics for the number of convictions in a year, the figures show that in more than 99 out of 100 offences, the person who commits the offence, the landlord who undertakes the unlawful eviction, walks away scot-free, so it is little surprise that people do not regard the enforcement of the law as adequate.
Your clause 58 in the Bill is so important because it corrects one of the major defects in what is a 46-year-old piece of legislation, the Protection from Eviction Act, which does not do what it says on the tin. It has not been preventing evictions because nobody has a duty to enforce it. That is a very long answer to your question, but there is a lot of support for what I am saying in those data.

Jacob Young: Q  We have spoken a lot about data and the portal in this session. How do you think we can use that data to judge the effectiveness of the reforms? Going back to our discussion about lessons learnt, in 10 years’ time we will need look back on this and are, “Where were the improvements that we could have made differently?” How do you think we can use the data to help to shape that thinking?

Roz Spencer: Our count report is in the House of Commons Library. It argues strongly that the Government need to start counting the data. I would not have thought it would be problematic for the Government to introduce their own mechanism for counting, and we talk about the methodology at some length in the report. I would advocate that you start showing, as Government, not only that the law and enforcement matter, but that you understand that the impact assessment needs to be based on data that you simply do not have at the moment.

Samantha Stewart: I am not saying that we are going to fund this, but we should all think about something similar to what we are doing with funding in Scotland. If you want to really understand how impactful the legislation is, we should start tracking it pretty soon, using the data and everything else at our fingertips.

James Gray: As there are no further questions from colleagues, I thank our three witnesses for their evidence: Samantha Stewart, chief executive of Nationwide; Linda Cobb, services manager for DASH; and Roz Spencer, director of Safer Renting.

Examination of Witness

James Munro gave evidence.

James Gray: We theoretically have until 4.15 pm, but it is unlikely that we will use all that time. If we finish earlier, we can all go off and have a cup of tea. Mr Munro, could you introduce yourself for the record?

James Munro: My name is James Munro. I am head of the National Trading Standards estate and letting agency team. I want to put it on the record that we are grant funded by the Department for Levelling Up, Housing and Communities, and we also receive funding from the Department for Science, Innovation and Technology.

Matthew Pennycook: Q  I have two quick questions. The National Residential Landlords Association has called for the selective licensing of landlords to be abolished. Do you think it falls away if the portal operates in a particular way, or will elements of selective licensing still need to be in place to augment the portal if the local area in question chooses that? I am thinking of space standards and other things that the portal might not necessarily cater to.
Secondly, is the Bill missing something by not incorporating any regulation of property agents? Are we missing an opportunity to incorporate the recommendations set out by Lord Best’s working group in or alongside this legislation in some form?

James Munro: The first part of the question is a very good one, and I am not sure I am going to be able to give you an answer. I think the answer is probably yes and no, or somewhere in between. It is very difficult. It is one of those things where time will tell. Selective licensing schemes can bring benefits, but they are also a rather blunt tool in some respects, so I think it is a mixed bag. Possibly yes, that could happen.
Again, to be transparent, I sat on the working group with Lord Best where the regulation of property agents was debated. I think regulating property agents would be a good thing. When the public deal with professional people responsible for significant assets or significant issues in their life, they are, generally speaking, licensed or regulated in some way. As things stand, there is quite a mixed bag of regulation that applies to estate and letting agents—collectively, property agents. For example, the regulatory regime applying to estate agents is completely different from the regulatory regime that applies to letting agents, and I think bringing them together would be a good thing. Obviously, it would be expensive and would probably require another public body to be set up. There are issues about who would take on that role, but in theory I think that is a good thing.

Jacob Young: Q  I am interested in your view on the principle of blanket bans and the measures we are taking in the Bill to stop them.

James Munro: Blanket bans are a good thing on paper, but in practice they can be very difficult to enforce. Obviously, the enforcement is where I am coming from with this. That is what we do with estate and letting agents at the moment, and with landlords in respect of the Tenant Fees Act 2019. We are the leading  enforcement authority under the Estate Agents Act 1979 and the Tenant Fees Act. It is very tricky when you start putting blanket bans on things—for example, on saying, “No pets”, “No children”, or “No DSS”—because ultimately it is up to the landlord to decide who he or she wants in the property. It is very difficult to prove that that decision has been taken to directly discriminate against somebody with a pet, with children or in receipt of benefits.
While I am on that subject, I think the legislation would benefit from always including the words “prospective tenant” when dealing with issues around discrimination. Clearly, at the point at which someone is being discriminated against, they are not normally a tenant—they might well be a tenant at some stage, but at that point they would be a prospective tenant. It is important to have consistency throughout the legislation in that respect.

Lloyd Russell-Moyle: Q  It seems difficult to enforce blanket bans. Is there any way forward in which these bits of information are not disclosed and cannot be asked about in any form, directly or indirectly, until after a tenancy has been verbally agreed?

James Munro: That could be a way forward. It just goes back to the fact that it is very tricky to work out, because discrimination can be written, verbal or non-verbal. It can be incredibly difficult to prove, unless it is recorded in some way, and then it is down to the investigatory powers, the sanctions available and, ultimately, the impact of that discrimination on someone, because it will be considered in line with all the other local authority priorities.

Lloyd Russell-Moyle: Q  On standing enforcement, a lot of local authorities use the selective licensing resource to help to pay for their enforcement. Is there an argument—perhaps the opposite argument from the one made by my colleague—that the property portal could allow the roll-out of selective licensing more freely in all places where there is then, in effect, a small charge for enforcement?

James Munro: It could work. In theory, what we are trying to achieve is to get greater resources to local authorities. I do not really have a view of how that is done; it is more about getting those resources to local authorities and about ensuring that local authorities prioritise the work correctly. At the moment, there are huge differences in enforcement across the country—the so-called enforcement postcode lottery—and, depending on where you are, it could be a different priority for that particular local authority.

Lloyd Russell-Moyle: Q  We touched on rent repayment orders previously, where tenants are motivated to take their own enforcement because they could receive their own rent. Could those offer an option to relieve local authorities from having to enforce some of the more minor cases and allow them to focus on the most egregious breaches?

James Munro: I agree that that would be a way forward. It comes back to the points that have been made before: it is about the education and knowledge of the tenants, so that they understand, first, that they can take that action and, secondly, that they take the action and get the relevant support to do it. Tenants are  woefully unprepared. They do not have the knowledge, the expertise or the help to take action forward where necessary. You will see examples of that being done generally, where either people have done it because they had that specialist knowledge, or they get the specialist support, which might be available in certain areas but not in others.

Lloyd Russell-Moyle: Q  Do you think the property portal might provide an opportunity not just for information holding, but for information dissemination?

James Munro: Yes, but the property portal will only disseminate that information to those who are registered on it, and the challenge—as with a lot of things with this Bill—will be to ensure that, in the early days, in year one or year two, everyone gets up to speed with this, and not just the landlords but the tenants and prospective tenants. It comes back down to education. The question was asked earlier, “How do we get the message out to people?” You need to teach it at school. We leave school not knowing how to buy a house, buy a car, rent a house or anything like that.

Lloyd Russell-Moyle: Q  Some of us push very hard for citizenship lessons and wider lessons like that in schools, but that is another debate. You might not know about this, but when the deposit protection scheme was rolled out, there was a big information campaign with local authorities and with charities and non-governmental organisations to inform tenants about their ability to get rent repayment orders if deposits were not secured. That seems to me to work very well. Do you have any views on and learnings from that process?

James Munro: Yes, that process has worked well, but I think that is because it is a process that benefits all parties. It is very strictly controlled. The sanctions and penalties are clearly set out. I think it is something that works very effectively. Redress scheme membership, for example, works very effectively. The Government obviously issue the “How to rent”, “How to buy” and “How to lease” guides—all the different how-to guides—and I think they could play a very useful part, but obviously you have to get them into the hands of the tenants.  Again, it comes down to the point that was discussed earlier, especially with students. Students just want to get their hands on the property—they will sign anything just to get their hands on it. They do not necessarily understand, realise or appreciate any rights or obligations that they may have under that agreement.

Helen Morgan: Q  I just want to go back to that point. Earlier, I used the word “unprofessional”. What I meant was amateur rather than negligent or wilfully reckless. There are a lot of accidental landlords out there—I am talking about people who do not use a letting agent. They will need to be aware of their responsibilities under this legislation. Who do you think is the right person to manage the information campaign to ensure that they are aware? Is that the local authority? Is it the charitable sector? Who should be ensuring that landlords are aware of their responsibilities under this new legislation?

James Munro: I think it is a combination. You have the National Residential Landlords Association; you have various trade bodies and various professional bodies that represent landlords. They are the first port of call. I also think local authorities and charities—all those third sector organisations—could get that information out there. The challenge is that the landlords who have perhaps one property are, for all intents and purposes, treated almost like private individuals. For tax purposes, they are virtually treated as private individuals, so there is no real avenue to find out where they are. That is going to be the challenge—to reach out to them but also to get them to comply with the requirements.

James Gray: As colleagues have no further questions, I would like to thank you very much indeed, Mr Munro, for giving evidence to the Committee. Your words will stay with us as we consider the Bill line by line, starting from next week.

Ordered, That further consideration be now adjourned. —(Mr Mohindra.)

Adjourned till Tuesday 21 November at twenty-five minutes past Nine o’clock.

Written evidence reported to the House

RRB24 ACORN
RRB25 Independent Age
RRB26 Battersea Dogs & Cats Home and Mars Petcare UK
RRB27 Quintain Limited
RRB28 Northern Housing Consortium
RRB29 Age UK
RRB30 Safer Renting
RRB32 Department for Levelling Up, Housing and Communities